The trading volume of the stock market is much smaller than that of the foreign exchange market, and tens of millions of non professional investors affect the normal operation of the market, making it more difficult to predict the movement of the market. Foreign exchange market is the largest financial market in the world, including many large players – banks, investment funds, companies and other financial institutions. Therefore, no matter how many individual investors participate in the foreign exchange market, the impact on the price is very small.
Dow’s theory is mainly applied to the stock market, but like other technical analysis theories, it can also be properly adjusted and applied to various investment markets according to different characteristics of different markets. According to Dow Theory, there are three trends in the stock price movement, the most important of which is the basic trend of the stock, that is, the change of the stock price in a broad or comprehensive way. This change usually lasts for one year or more, and the total increase (decrease) of stock price is more than 20%. For investors, a long market is formed when the basic trend continues to rise, and a short market is formed when the trend continues to decline.
Just like the stock market risk, foreign exchange risk also exists. Just like the stock market analysis chart, foreign exchange also has its own graphic analysis tool, which is the foreign exchange trend chart, which reflects the changes in the price of the foreign exchange market. As the foreign exchange volatility is the same as the stock market, the foreign exchange trend chart can be divided into real-time chart, minute chart, hour chart, daily chart, weekly chart and monthly chart according to the time.
Technical analysis is based on the daily price fluctuations in the market, including the daily opening price, closing price, highest price, lowest price, trading volume and other digital data, which are expressed through charts, so as to predict the future price trend. Every analytical method is not perfect. We can neither rely too much on technical analysis nor lean to basic analysis. In theory, after the basic analysis, we can use technical analysis to catch the rising and falling waves of every gold market.
The number of foreign exchange participants is not the number of investors who want to trade as many as they want, but the risk that their positions can bear when trading online foreign exchange. The number of foreign exchange participants is proportional to the risk. In general, we suggest that the margin required to build a position should not exceed 20% of our total capital, otherwise there will be a risk of position explosion. For example, the margin we need to trade one dollar against yen is $2.50.
As the only non credit currency in the world, gold is different from paper currency, deposit and other monetary forms. It has a very high value, unlike other currencies, which are only the representatives of value, and its own value is very small. In extreme cases, money will equal paper, but gold will never lose its value as a precious metal. Therefore, it can be said that gold can be regarded as the representative of eternal value. The most obvious manifestation of this significance is the investment value of gold …
The number of traders is the number of orders made by traders. One standard hand in online foreign exchange transactions represents 100000 base currencies, 0.1 hand represents 10000 base currencies, and 0.01 hand represents 1000 currency units. Due to different currency values and real-time changes in exchange rates, the margin will increase or decrease at any time. Therefore, investors need to calculate the amount of money required for different trading hands according to the size of trading leverage and specific currency pairs.
The impact of the US dollar on the gold market has two main aspects. One is that the US dollar is the marked currency in the international gold market, so it has a negative correlation with the gold price. Assuming that the gold price itself has not changed, the US dollar will fall, On the other hand, gold is an alternative investment tool for us dollar assets. In fact, in the years before 2005, the price of gold kept rising, and one of the main factors was the sharp decline of US dollar for three consecutive years.